Local shares closed down despite opening higher after taking a strong lead from US equity markets, which closed higher following the release of better than expected US non-farm payrolls data on Friday.

The surprise strength in jobs market has prompted $US614 billion ($676 billion) US investment house T. Rowe Price to alter its house view on when the ­Federal Reserve will start reducing its stimulus.

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“We were assuming the taper would start in March, but following the latest job numbers it is likely to be sooner, but not as soon as this month," Baltimore-based T. Rowe Price Global Equity Fund portfolio specialist Kurt Umbarger said.

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“The Federal Reserve will likely use the December 18 meeting to send a clear message that they intend to start tapering bond purchases in the first quarter of 2014."

“If the taper is more aggressive than expected then interest rates could spike prompting capital outflows, particularly from emerging markets, but we think that the event is mostly priced in and any volatility should be modest and create buying opportunities."

Typically, improving employment conditions in the world’s biggest economy is a positive indicator for global sharemarkets.

But the effect of good news in the ­current environment is more ­complicated because the US Federal Reserve has said it will begin reducing its massive monetary stimulus when there is sufficient evidence of recovery in the employment and housing markets.

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A number of Federal Reserve officials were due to speak early Tuesday ­morning Australian time. The speeches will be scrutinised for any clues as to the likely timing of a reduction in the central bank’s $US85 billion in monthly asset purchases.

At the local close, the dollar was ­buying US91.04¢, up from US90.56¢ at Friday’s close.

Financial services was the worst-performing sector, down 1.4 per cent.

QBE slumped 22.3 per cent to $12, after emerging from a trading halt to warn it would suffer a $250 million reported net loss for the year.

“As a shareholder with a long position in QBE the news is very disappointing, but what is more important now is whether the company can deliver on its forecasts for 2014," Market Matters stockbroker and principal Shawn ­Hickman said.

Among QBE’s local competitors, Insurance Australia Group, owner of NRMA, dropped 1 per cent to $5.72, while wealth management and ­insurance group AMP shed 2.3 per cent to $4.35.

Commonwealth Bank of Australia dipped 0.4 per cent to $74.90, while Westpac Banking Corporation lost 1.3 per cent to $31.09. National Australia Bank fell 0.9 per cent to $33.17 and ANZ Banking Group shed 0.8 per cent to $30.75.

Qantas Airways lost 3.4 per cent to 99.5¢, closing below $1 for the first time in 17 months, after it announced the ­closure of Jetstar’s Darwin base.

Corporate raiders are reportedly circling after Qantas lost its investment-grade credit rating on Friday and amid political controversy over the pros and cons of allowing more foreign investment in the national carrier versus a potential government bailout.

Rival carrier Virgin Australia ­Holdings was unchanged at 38.5¢.

China’s November headline ­consumer price index edged down to 3 per cent year-on-year, below market expectations for a fall to 3.1 per cent.

HSBC China economist Ma Xiaoping noted: “Inflation pressures remain manageable, which will allow policymakers to continue focusing on policies to support growth while implementing structural reform measures going into 2014."BHP Billiton edged up 2¢ to $36.77, and Rio Tinto gained 0.2 per cent to $66.53. The third-largest producer, Fortescue Metals Group, added 0.7 per cent to $5.72, after the spot price of iron ore, landed in China, continued to ­surprise with its strength at $US139.20 a tonne.

Woodside Petroleum lost 0.4 per cent to $37.40, as the Brent index for crude oil prices rose to $US111.74 per barrel.

“Gold stocks are worth a look for the first time in more than five years," Mr Hickman said. “If the gold price slips on a taper shock and gold stocks don’t go down too badly then that could be a sign the selloff in goldminers is complete."

Plasma product and vaccine maker CSL fell 0.7 per cent to $66.82. “If shares do pull back as a result of taper, then that will be an opportune time to buy into good companies with good exposure to offshore earnings, such as CSL," Mr Hickman said.

Metcash gained 4.3 per cent to $3.15. Shares rebounded from an eight-year low following the announcement of plans to unwind a merger of the wholesale and retail divisions. Woolworths lost 0.3 per cent to $32.90, while ­Wesfarmers, owner of Coles, dipped 0.1 per cent to $41.64.

The end-of-year flurry of initial public offerings continued. Adult education business Vocation Group added 7.4 per cent on debut to $2.03, while childcare roll-up Affinity Education Group rose 4 per cent from its offer price to $1.04.

Brambles fell 1.1 per cent to $9.28 ahead of the demerger of its information management business Recall Holdings on Tuesday. Hotel Property ­Investments, a portfolio of Coles­-operated pubs and bottle-shops, will also list on Tuesday.